HFT, A scary word for investors, isn’t it?
Like SIVs (Structured Investment Vehicles) were enigma few years earlier, HFT is an enigma now. However, it is simple and not complicated as one thinks.
I can educate people only to certain level on this public forum. Briefly, correlation among variables is found out based on past data and theories developed. Simple program is written to flash signals when real time correlation deviates for any stock price, index or commodity.
Someone sipping a cup of coffee has to take position based on such signals. Off course, there is something more to it but I am trying to keep it simple.
-Shrihas Pandharkar,
DYOR.
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